From the timeless beauty of the Taj Mahal to the serene backwaters of Kerala, India is home to more than 1.4 billion people and is a vibrant mix of tradition and modernity. This land of festivals and history is also a hub for skilled remote talent.
Key takeaways:
- India has a wide range of skilled professionals, from tech experts to creative minds, ready to be integrated into global remote teams.
- To ensure compliance during the hiring process in India, employers must understand labor laws, employment contracts, working hours, and paid leave policies.
- There are several ways to pay Indian remote talent, but one of the fastest and easiest ways is using an Employer of Record (EOR).
Advantages of Hiring in India
As the world’s second-largest English-speaking country, with more than 125 million English speakers and a workforce of over 640 million people, India offers a growing talent pool of educated professionals.
A well-developed internet and mobile network makes remote work feasible even in Tier-2 and Tier-3 Indian cities.
The benefits of hiring remote employees in India include the potential for cost savings, as the average wage in India is significantly lower than in many Western countries. For instance, the average hourly rate for skilled labor in India can be as low as $2 per hour, making it a cost-effective choice for hiring global team members.
Key stats about India include:
- Languages: English, Hindi, and other regional languages
- Currency: Indian Rupee (INR)
- Capital City: New Delhi
- Population: 1.4 Billion
- Cost of Living Rank: 136th
A Growing Remote Workforce Hub
The Indian Government has significantly invested in digital infrastructure, such as the Digital India initiative, to improve connectivity and digital literacy.
With 1.5 million engineers graduating each year, India is rapidly becoming a hotspot for businesses hiring remote tech and IT professionals. The IT sector alone is responsible for 7.5% of India’s GDP in FY23. By 2025, that number is expected to reach 10%.
Common skill sets for remote talent in India include positions in:
- Information Technology
- Software Development
- Finance
- Content Writing
- Customer Service
- Digital Marketing
- Graphic Design
Employment Laws: Hiring Compliantly in India
Employment Contracts
The different types of employment contracts in India include:
- Permanent Employment Contract: For long-term full-time or part-time employment with no fixed end date
- Fixed-Term Contract: Predetermined end date, typically for specific projects, providing flexibility with no long-term commitment
- Casual Employment Contract: Combines fixed-term and permanent elements with a set end date and fixed working hours
- Zero-Hour Contract: Flexible work with no guaranteed minimum hours; work is offered on an “as-needed” basis, and the employee is not obligated to accept
- Freelance/Contractor Contract: For self-employed individuals who work on company projects or temporarily
Working Hours & Pay
The Factories Act of 1948 sets a standard workweek at 48 hours, typically spread over six days. Any work performed beyond this is considered overtime — limited to 50 work hours per quarter and paid double.
India does not have a universal minimum wage. State governments determine it by industry, skill, and location, with a national minimum of INR 178 daily.
The 13th-month salary bonus is typically mandatory in India and is paid as a portion of the annual salary before the end of the year.
Probation Period
Indian law doesn’t mandate probation, but the Industrial Employment (Standing Orders) Act sets a maximum of two months, extendable to four, with mutual consent. Most private companies prefer three to six months.
Employer Taxes
Employers in India pay various taxes and contributions on behalf of their employees. They must contribute 12% of an employee’s basic salary to the Employees’ Provident Fund (EPF), with an additional 1% for administration.
Companies must also pay 4.75% of wages into the Employee State Insurance Scheme (ESIC) for medical and social security benefits.
Termination Process & Severance Pay
In India, there is no unified law specifying notice periods for termination. However, employees who have completed at least one year of continuous service are entitled to one month’s notice.
If terminated, employees who have completed at least five years of continuous service receive a gratuity of 15 days of wages for each completed year of service.
Paid Leave Laws in India
Vacation and Holiday
To ensure worker well-being, employees typically earn one day of leave for every 20 days worked. This amounts to around 15-18 days of paid leave annually, depending on the employer’s leave policy.
If left unused, earned leave can be carried over to the following year, with a maximum limit that varies from state to state.
India has only three national holidays:
- Republic Day
- Independence Day
- Gandhi Jayanti
There are 14 mandatory holidays, 12 optional holidays, and 33 restricted holidays, varying by state and organization.
Sick Leave
India doesn’t have a national law governing sick pay. It varies by state, but companies typically grant up to 12 days of paid sick leave annually. A medical certificate is generally required for absences exceeding two days.
Maternity Leave
Indian law stipulates that pregnant women receive 26 weeks of fully paid maternity leave. Up to eight weeks can be taken pre-delivery and 18 weeks post-delivery. For women with two or more children, the benefit is reduced to 12 weeks.
Paternity Leave
Government employees in India are entitled to 15 days of paid paternity leave. There is no statutory requirement for paternity leave in the private sector, but many companies create their own paternity leave policies.
Why Digital Nomads Love India
India may not have a dedicated digital nomad visa, but it does have a tourist visa (valid for six months) that allows visitors to stay and explore the country while working.
One of the major attractions for digital nomads is India’s relatively low cost of living. The country also ranks 47th globally in mobile internet speed, ensuring digital nomads can stay connected and productive.
India is home to several vibrant cities that are attractive to visiting remote workers. For example, Bangalore, known as the Silicon Valley of India, provides excellent co-working spaces, a strong tech industry, and fast internet speeds.
Cities such as Goa, Mumbai, and Delhi also offer a welcoming environment for remote workers to live, work, and explore.
How to Pay Remote Workers in India
There are several ways to pay your remote Indian employees:
- Bank wire transfers are a standard option for paying Indian remote workers and provide direct deposits in Indian rupees. They are secure and reliable. However, they can be time-consuming and may involve transaction fees.
- Platforms like PayPal and Wise are easy to use, widely accepted, and offer buyer protection but may have transaction fees and limitations on transfer amounts.
- For companies managing global payrolls, partnering with an Employer of Record (EOR) can simplify the payment process as they handle compliance, payroll, and tax obligations across borders.
Hire in India with Remofirst
Remofirst allows businesses to tap into the global talent pool and hire and manage employees in over 180 countries, including India.
Our comprehensive EOR services include hiring, onboarding, payroll processing, administration, and ensuring compliance with all local employment regulations.
Book a demo today to discover how Remofirst can help you hire top talent — no matter where they live.
